Leaving assets to charity in your estate plan

On Behalf of | Jan 30, 2025 | Estate Planning

Including charitable giving in your estate plan is a meaningful way to leave a lasting legacy while supporting causes that matter to you. Whether you want to fund medical research, support education or contribute to a local nonprofit, your estate plan can help to ensure that your generosity continues to benefit others beyond your lifetime. 

By employing a careful approach to estate planning, you can maximize the impact of your gift while also benefiting your loved ones and reducing tax liabilities. In this way, your choice to give to others may also directly benefit your estate in the end as well. 

Common charitable giving strategies

If you’re not sure how to get started, that’s okay. You can choose how much and in what way you give, allowing you to tailor your plan to your financial and personal goals. Common charitable giving strategies employed during the estate planning process include:

  • Charitable Bequests in a Will: You can designate a specific dollar amount, a percentage of your estate, or particular assets such as real estate, stocks or valuable collectibles to be gifted to charity per the terms of your will. 
  • Naming a Charity as a Beneficiary: You can name a charity as a beneficiary of life insurance policies, retirement accounts (such as an IRA or 401(k)) or investment accounts. This method will allow a charity to receive funds directly, bypassing probate.
  • Charitable Trusts: You can either set up a trust that will allow you to receive income from the trust during your lifetime, with the remaining assets going to the charity upon your passing, or a trust that will pass income to a charity for a set number of years, after which the remaining assets will go to your beneficiaries, often resulting in tax advantages.
  • Donor-Advised Funds: A donor-advised fund (DAF) allows you to set aside assets for charitable giving while giving you flexibility in choosing when and how funds are distributed to charities.

To better ensure your charitable gifts align with your estate planning goals, consider reaching out to a knowledgeable legal team. Simply because you want to be generous with your assets doesn’t mean that you have to sacrifice your own time and effort to realize this goal.